Will Cook
Founder and Portfolio Manager, Sunriver Management · 1 appearance on the record.
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investorfoundersunrivermgmt.com ↗
Will Cook runs Sunriver Management, a Greenwich-based fundamental long/short equity hedge fund founded in 2014 that focuses on underfollowed small- and mid-cap equities. Before launching Sunriver, he served as a Sector Head at Ziff Brothers Investments for over a decade.
23statements → 5claims → 5claims resolved → 80%fully supported → 3.83/5average certainty → 1.61/5average debate potential →
4 supported 0 partly supported 1 contradicted how the 5 claims stand · each chip opens the sources
5 assertions · 1 opinion · 6 insights · 10 disclosures · 1 what if · every statement was checked. The predictions and assertions are the 5 claims: statements the public record can support or contradict. 5 are resolved. Everything else (opinions, insights, what ifs, disclosures) can never be settled by the record, so it carries no assessment.
The record, in short
What the tape says about how Will argues and how the claims held up. Everything they said, and everything said about them, is in the tabs below.
Their most notable supported claim
Cook: Prime broker data shows hedge funds retrench during market dislocations
“If you actually look at the data we get from our prime brokers, what at least we see is that the industry as a whole, the hedge fund industry as a whole, actually does not deploy more capital during periods of dislocation. The hedge fund industry retrenches an…”
Expressed certainty vs assessment result
weighted support: a fully supported claim counts one, a partly supported claim counts half. Each filled bar is clickable and opens exactly those claims; "none yet" means nothing said at that certainty level has resolved yet
Everything Will Cook said on Capital Allocators that made the record, most notable first. Filter by type, assessment or year in the ledger →
Cook: Doing the opposite of sell-side recommendations predicts future alpha generation
“You kind of want to do the opposite of what the sell side tells you to do in our business, and it can actually be a very powerful predictive tool for future alpha generation.”
Cook: High-performing active investors are still wrong 40% of the time
“You're wrong about 40% of the time in our business if you're doing a good job.”
Cook: Prime broker data shows hedge funds retrench during market dislocations
“If you actually look at the data we get from our prime brokers, what at least we see is that the industry as a whole, the hedge fund industry as a whole, actually does not deploy more capital during periods of dislocation. The hedge fund industry retrenches an…”
Cook: Short alpha generation is episodic compared to steady long alpha
“What I have found over the years is that long alpha generation tends to be a little more smooth and steady, not always, but a little more smooth and steady and short alpha generation tends to be a little more episodic. So there are periods when it just rains s…”
Cook: Low-quality businesses have outperformed in public equities throughout 2021
“Historically speaking, that tends to mean that low quality outperforms, which is what you've seen over the last call it, 12 months.”
Cook: Widespread speculation on unproven business models creates attractive short pipeline
“I'd say that the tailwinds to short selling right now are that there's been a quite a lot of speculation and quite a lot of, I think, willingness of investors to embrace Fanciful business plans with hockey stick projections that are currently unproven and in b…”
Cook: Mid-cap equities were the best-performing market segment over 30 years
“One is if you look over a very long period of time, mid caps have actually been the best performing part of the market over, say, 30 years.”
Cook: Companies falling between standard industry classifications are often inefficiently priced
“I've always loved these companies that fall kind of in between industry classifications. And the reason is because they're more likely to be inefficiently priced.”
Cook: Sunriver's internal data showed they exited structural short positions prematurely
“We were exiting some of our shorts, particular structural shorts too early. So we were taking a gain and then the short kept adding alpha even after we had exited. And so the data said, gosh, if we had just, I think we hold our shorts longer than the average h…”
Cook: Short sellers must hold positions longer for markets to become efficient
“Really good short ideas are hard to come by and the market's pretty smart. The longer you give the market, the more likely it is to be efficient.”
Cook: Sunriver faces short-side liquidity constraints above $1.5 billion in AUM
“What we have said is that we probably start to have some liquidity issues on, particularly on a couple of our shorts at around one and a half billion in AUM to stay in our sandbox and generate the kind of returns that we think We can and should generate for LP…”
Cook: Sunriver's proprietary sentiment tracker hit record highs across both books
“The short book right now actually has the highest sentiment tracker it's ever had. So it's an unusual setup for us. Usually you have one side of the book with
Really good sentiment tracker on the other side, not so good. You know, today we actually have high s…”
Cook: In investing, good ideas become bad when taken to valuation extremes
“A good idea taken to an extreme becomes a bad idea. And I think that's true in life and it's definitely true in investing. As an example I mentioned earlier, people have gone from talking about 20 to 30 times earnings for a good growth company to 20 to 30 time…”
Cook: Internet Capital Group reached $55B valuation with 100 employees
“The company peaked at a market cap of about fifty five billion when we had a little over a hundred employees at the time.”
Cook: Internet Capital Group stock dropped 90% to 95% in six months
“And then subsequently the stock fell something like 90 or 95% in the next six months.”
Cook: Sunriver shifted portfolio median market cap from $20B to $5B
“We have intentionally moved down market cap into less well-followed stocks. So our median market cap many years ago Was roughly twenty billion today. It tends to hover more around five billion.”
Cook: Sunriver employs an external forensic accounting firm for short analysis
“We also have an external forensic accounting firm that we work very closely with that helps us in really complicated accounting issues”
Cook: Sunriver holds about 20 concentrated longs and 35 shorts
“One is just purely from a concentration perspective that we are much more comfortable being concentrated on the long side than the short side. We have about 20 longs. Typically, top 10 longs are 60 to 70% of capital. Short side is less than half as concentrate…”
Cook: Sunriver generates alpha from selection and sizing, not tactical trading
“It really showed that we're adding a lot of value in security selection and a large amount of value in Sizing and really not much value in trading at all. Good news was we weren't destroying value in trading, but we weren't adding a lot of value in trading.”
Cook: Sunriver Management averages net market exposure in the low 40s
“We're roughly on average, low forties, 40% net.”
Cook: Sunriver typically holds at most one Goldman Sachs VIP stock
“At any given point in time, when I look at, say, for example, the Goldman Sachs VIP list, we'll have maybe one stock in there.”
Cook: Sunriver offers sliding-scale management fees and loyalty incentive cuts
“So we have a sliding scale management fee, which disincentivizes us to be asset gatherers and keeps us focused on performance. We also have a incentive fee that gets better with time. So the longer you're an investor with us, the better your incentive fee gets…”
Cook: Sunriver reviews portfolio losers annually to distinguish process from outcome errors
“At the end of every year, I go through all the big losers in the portfolio, and I try to separate process and outcome as best as I can, and really try and talk to each of the analysts about what I think are process mistakes as distinct from outcome mistakes.”
Appearances (1)
| Episode | Date | Speaking time |
|---|---|---|
| Will Cook - Sunriver Management (Manager Meetings, EP.22) | Dec 2, 2021 | 42m |